tv Your Business MSNBC December 24, 2011 5:30am-6:00am EST
small business optimism is up. how are small business owners feeling about 2012 and the presidential election? a former rocket who opens a dance studio sees her revenue grow by leaps and bounds. all that coming up next on "your business." small businesses are revitalizing the economy. american express hope is here to help. we are proud to announce "your
business" on msnbc. hi think, everyone. i'm j.j. ramberg. welcome to "your business" where we give you tips and advice for your business to grow. it's been up and down for small business owners. there's positive news for the new year. business optimism rose 1.8 points, the highest level since february. it showed an increase in small business owner who is expect sales to increase and those expecting to hire. it was a political football in 2011 with president obama pushing his small business jobs plan and supporting small business saturday. his political opponents raised issues affecting small business owners in debates running up to
primary season. what will 2012 bring for our entrepreneurial community. brian hamilton, the co-founder of a company that has software for small businesses, brian hecht and phil town. great to see all of you. >> thank you. >> bill, you have been here every year, i think, doing this with us at the end of the year. i want to start with you, also because we cited your survey. optimism up three years in a row. do you expect this to continue next year? >> i think it will continue as we look at the basics in the economy. either we are getting used to bad news and we are going ignore it and move forward or good things are happening. i think the latter is the case. we saw improvement in the optimism index. seven of the ten components went
up, put nice numbers in place. what you cited, we had a nice increase in owners planning to increase imemployment and the percent of owners with a hard-to-fill job opening meaning labor markets are tightening up. that means the unemployment rate is going to go down. claims will start to fade and we will make progress on that. we saw the capital spending up and plans up. the gdp numbers are looking better in the survey. >> phil, how do you think last year went? >> i think last year was a mess. uncertainty is the new normal. the result of that is that or the cause of that, i think, is not just economic uncertainty, but uncertainty created by mass government. entrepreneurs are resilient. there's entrepreneurship in cuba. we will always have small
governments. we have to realize the impact of this stuff. there was a story done last year. entrepreneurs hired 6% less people than they would have if it wasn't for red tape. just red tape. that translates to 1 million jobs, $40 billion of lost revenue the government could have collected taxes on. i'm seeing a continuation of this. as an investor, we are looking at the dangers of europe. no one knows what's going to happen to the banking system. i think it's going to have a big impact. it's going to be the new normal. >> we always hear uncertainties. i don't know what to do because i don't know the impact of what i'm going to do. i'm not sure about the taxes and regulations. brian hamilton, you had good news in a survey you did. >> hold the phone. look at the last 12 months. revenues are up. profits are up. the facts are good. attitudes, what's going to happen is all important.
let's look at what's actually happening out there. private companies, 27 million of them are growing right now. that's a fact over the last 12 months. so, it's kind of missed in the media picture. we need to know what's happening. according to our data, it's very strong. >> do you feel like that's going to continue into 2012? >> it's a great question. over the last 200 years we found for every four years of expansion, we have a down year, right? once those tides start to turn, they usually keep going. we expect a good year, we really do. >> brian hecht, you have started and sold three businesses. it's in the tech base, which is different than a lot of the other businesses and booming right now. what do you feel as an entrepreneur. >> 2011 was a messy year, marked by a lot of indecision. a lot of entrepreneurs are
trying to decide is it the time to grow or make sure we have enough cash in the bank if we have another bad year. they are always going to be bias toward growth. that's why we are entrepreneurs. we are looking for opportunities. when the data tips in our favor, we are going to seize those opportunities. 2012, i think is going to be not a radical shift, but a subtle shift, easier lending, easier raising capital, easier to stimulate consumer demand. that could switch things to be a growth year for 2012. >> you are raising your eyebrows, bill. brian hamilton is shaking his head. >> i don't think we'll see easier lending. the banks are in trouble. the regulations are restrictive. they are not able to lend to entrepreneurs like they used to. look them in the eye and say sure, we'll make the deal. angel capital is going to be the go-to people. they will have to step up their game. we do talk about it.
how to step your game up to get capital when it's not available. that's coming in 2012. >> when brian hecht was here saying things are getting better, you are shaking your head. >> look at the data. revenues are up. it's a fact. it's happening right now. it's already tipping. the attitudes are catching up to the data. we have to get that data out there. things are not a mess right now. they are not. revenue is up for private companies. about 6% to 7% across the board. across 1400 industries. itis not all doom and gloom. we have to get that out there. >> bill, what do you think your small business owners need the most to keep optimism up? >> we need customers. the university of michigan index for consumers is the worst we have seen since 1980, not a great time. we had the index go up for three months now, it's still lower than in january.
not a lot of progress over the year. uncertainty is a big issue. we did a special study of dunn and bradstreet firms. on a one to seven scale, 60% of the owners rated a six or seven is uncertainty about business decisions. over half of them attributed that to politics, what's going on in politics. that is important. we don't know what the tax rates are going to be in the next month or so. we don't know what's going to happen with health care. what it will cost for employees. there are so many things we don't know. europe is a scary thing. not that we think we'll be like athens but we know the fiscal path is similar to the one the sovereign governments in europe were following. we need to get off that. a nice settlement on something. washington would be very helpful as well. >> we have to end this conversation. i want to end it with one thing
from each of you. it's a political year next year. january, we are full steam ahead. if you had one thing to say to washington, this is what small business owners need, what is it? brian hamilton, i'll start with you. >> what are you going to do? what policies are going to be in effect. give me something i can plan from. it's that simple. whether that will happen is anyone's question. >> this is our wish list. okay, phil, you? >> i second that statement, i would add please roll back the regulations to where they were when clinton was in office, 1999. get the regulators out of our business and be free to do what we do best. >> brian? >> i will say make it easy to hire people. we have no capacity to handle beaurocracy. make it easy, everybody wins. >> bill, we'll end with you. >> i agree with that. it would be nice to have certainty, even if it's bad certainty.
if we knew what was going on, it would be helpful. we would like to see the dodd-frank rollbacks so investors could more easily function. less regulation across the board. that would be terrific. give us a way out of this fiscal mess that we are in so we can believe in the future and not see greece coming our way. >> all right. i thank all four of you for your insight very much. i look forward to talking to you at the end of 2012 to see what comes of next year. hope to see you before then. thank you so much. you guys stick around. >> thanks, j.j. we talk a lot on this show about starting companies that are in line with your passion. we also have cautious tales about how passion isn't everything. you have to be able to run a sound business. we have a story about a woman who was passionate about dancing. when she decided to hang up her
professional dancing shoes, she was able to make a second career out of that same love. professional dancing takes agility and discipline. just ask a world famous radio city rockette. >> point. bring it back. good. >> the same can be said about running a small business. ask any owner what it takes to survive in this economy and the the same qualities could make it to the top of the list. >> good girls. >> amy knows what it takes to succeed in both worlds. she performs with the rockettes for more than a decade and opened up a dance studio in jersey city. >> there are no dance studios in jersey city right now. i seized the moment. this is an area with lots of kids. we are right next door to broadway. i think i have something special to offer them. >> success in the business is
entirely different from being successful at business. she set out to be professional at that as well. >> i took a year to prepare myself for the business. i talked with a lot of entrepreneurs and got ideas. i took business seminars and learned simple things like how to write a business plan. >> a plan calling for measured growth. classes were limited in time and scope. >> we started with cannes classes and a couple voice and acting classes as well. ♪ >> so, we have a whole morning of hours empty. we needed to fill those hours. >> as her business grew, so did the ability to innovate. she discovered she could monotize something many business owners overlook. space. >> why did you think about the idea of renting space?
>> in the beginning, i was very busy as a business owner and couldn't take on another class myself. it was easy to get these other businesses to come in. they already created a class themselves, they could come in and rent the space. ♪ >> for adam roberts, a licensee, it's the perfect situation. >> right now, i'm in four locations five days a week. i needed space like this. it's wonderful it's empty in the morning and i can use it. >> with the popular class bringing in children and parents, she discovered a way to advertise her studio for free. >> families come in that normally wouldn't come in. the children are younger or interested in something different than we have to offer. they like the surroundings. they like that it's a safe, fun environment. we get more students that way. >> she was aggressive, yet focused in her expansion.
he added advanced classes. adults were on her radar. >> we wanted to start adult classes. our challenge was finding when the adults could come in. we found out they needed baby sitters. our answer to that was to have a children's class at the same time. >> amy found a revenue stream in collaborating with other performance groups. >> i always wanted to do a holiday show for my children. i wasn't ready to take that on myself. so, the local dance company came to me and said we have an adult dance company and we want to do the "nutcracker" for our community. you have the children. so, collaborating with this dance company was perfect. >> the agility game through years of dancing is paying off in an unexpected way. now, she's preparing a new generation of performers to take their first steps. >> i love the children. i love watching them enjoy
dancing and expressing themselves. kids are amazing. to watch them learn from you and showing them what you know, to see the smiles on their face, it makes me happy every day. what franchise categories are prime for growth next year? here are five franchise trends to keep on eye on in 2012. number one, burgers. the new breed of better burger restaurants is on the rise. more seasoned fast food franchises are expanding their menu to compete. two, the child care industry. franchises offer parents a variety of options ranging from nannies to baby sitters. three, sandwiches. subway became the biggest quick service chain this year showing just how popular sandwiches are. smaller franchises are finding plenty of room to grow as well.
four, the fitness industry. trendy gyms, and other fitness options are going strong. five, senior care. with the first baby boomers turning 65 this year, they have expanded from simple companion care to include medical care, assisted living placement and transportation. what are the biggest challenges facing small business owners today? phil and brian have answers for us. a holiday passion becomes a booming business in ohio. shazi: seven years ago, i had this idea. to make baby food the way moms would. happybaby strives to make the best organic baby food. in a business like ours, personal connections are so important. we use our american express open gold card to further those connections.
last year we took dozens of trips using membership rewards points to meet with farmers that grow our sweet potatoes and merchants that sell our product. vo: get the card built for business spending. call 1-800-now-open to find out how the gold card can serve your business. tis the season for many small businesses to capitalize on the holiday spending frenzy. it's a particularly busy time for entrepreneurs whose business is seasonal. that's the case for an ohio based entrepreneur we met last year whose passion for "a christmas story" attracts fans of the movie from far and wide. tis the month before christmas and all through the house, the tourists are flocking to see a christmas story house.
the lamp was place d by the window with care. not one person left without a knickknack to share. >> we sell t-shirts, sweatshirts, leg lamp night lights, ornaments, cookie cutters. decoder pens, fudge. >> brian jones is a lifelong fan of the 1983 holiday classic "a christmas story." >> my husband is christmas story obsessed. >> the latest is the legendary leg lamp. >> that is in fact glorious. it's beautiful. it reminds me of the fourth of july. >> what started on a whim in 2003 turned into a business he ran out of his garage in san diego. >> sell a couple leg lamps, it will be funny. extra income. it exploded. i guess i'll do it full time. >> he was worried about the
fees. he contacted the film company, warner brothers. got a letter back saying it's great. if you are going to do something further, let us know. >> a year later, the house where the movie was made came up for sale on ebay. >> took me 30 seconds to decide to buy it. it said it was in cleveland, ohio. >> i don't know whether to laugh or cry. it's how i felt at the time. >> it's a little far from san diego. i can make it work, no problem. >> jones bought the house, sight unseen making a down payment with money from his leg lamp business. with the intention of restoring the house to the way it looked in the movie, inside and out, he needed money. >> i started it as a fund-raiser to try to generate money to republican kn
renovate the house. we had a grand opening, it's been fun. >> now every year at a hotel in cleveland, the christmas story convention kicks off the holiday season bringing die-hard fans to meet the actors. >> i played flick. >> randy parker. >> tour the house. and pose with the leg lamp. for jones, it was a no brainer. his christmas story house and leg lamp business were now officially a big deal. he figured it was time to call warner brothers back. >> legally and from whatever standpoint, it had to be licensed to call it a christmas story house. >> with 5% to 20% going to warner brothers, it's been a boom to jones and his business. his website is one-stop shopping with all things associated with "a christmas story." >> 75% of our business is online.
it wouldn't be where it is today if it weren't for the memorabilia because we licensed. it's the way to go, the right thing to do. in the end, it works out well for you. it's time to answer some of your business questions. brian and phil are with us once again. the first is about the state of small business. >> what do you see are the top five universal challenges all business owners face today? >> before we were talking big picture. here, there are small things people face. brian? >> sure, one thing is competition from cheap technology. used to be, if you had a good website or good store, you had a defense against new competitors. now, it's easy and cheap, a competitor come in, if they have a good product, eat your lunch. you have to have an eye on other folks coming up on your tail and
taking away your business. you have to play defense. another one is there is still enormous competition for talent. everyone says there are so many unemployed people out there. put an ad on craigslist and find someone. that doesn't work. the competition for good people is very, very tough. i have a difficult time hiring good people in this market. >> i'm going to bring phil in. >> you want as. i'm going to go beat my drum i beat every time here, which is entrepreneurs make the mistake of going into a business and trying to compete on price instead of getting a niche they own. starting small, focused and dig in on that niche. when they compete on price, they end up undercapitalized, unable to get lending. they can't get angel investing. terrible business model is the number one problem.
>> all right. you have a couple more? >> yeah, i do. one is the bright, shiny object problem. it's especially acute now. we have mobile, facebook and twitter. it's easy to become enamored with those things. it's cheaper to get involved. easy to get lured into them. if i'm spending time, time is money. am i going to make money. >> let's move on to the next question. this is an e-mail from frank. i was working for a large real estate brokerage for nine years. i started my own firm. i want to attract new agents. i'm offering a split 90/10 to experienced agents. how do i get them to make a change. >> he's on my worst hated thing. he is competing on price. he needs to go be great in a
boutique brokerage, niche marketed, get ahold of something he can control and understand. the way to do that is go serve your community. get involved in the chamber of commerce, the groups out there. serve the community. focus on the niche and build a reputation and brand. that is what will bring people to you who are great agents. you will have the listings in that area. >> he can provide something. small businesses provide something large businesses can't, flexibility. >> self-examination is in order here. ask yourself, why do i enjoy doing this? why do i enjoy working here? work/life balance, community service? there are many reasons people decide where they want to work. people work for managers. are you a good manager? >> that's a good point. this is an e-mail from the owner of a company that sells
t-shirts. i wonder how i can get people to buy after visiting my t-shirt site. i can get folks to go to the site but can't get them to buy. i love this question because a lot of times people who have websites are so concentrated on how many people visited my site. it's not necessarily an interesting number. >> brian is the world expert on this. >> i deal with this in every company i have ever had. our viewer has a good problem. a lot of people have trouble getting them to our site. what happens doesn't matter. it's all in the details. there is a body of knowledge. 50 years of direct marketing that tells you how to convert someone. the letters you get in the mail to get you to give to a charity or record club. all the fundmental truths are there. let me give you the one that is most important. when someone arrives at the web page, give them one thing to do.
content rich experience with 50 choices to explore, they are distractions from the transaction you want. click here now are the three most powerful words. >> i would load up the testimonials. i respond to that when i look at a new site. i want to see, you know, are people using this? are they getting a good thing out of it? the way you use them is send a thank you message to buyers. let them respond to that nice message you gave them, then you have your testimonial. >> that's great. i don't know if you have read this, the book "influence." to your point about little things to do to get people to buy. it's one of my favorite books. fantastic advice. thank you so much. appreciate it. if any of you out there have a question for our experts, go to our website. the address is openforum.com/yourbusiness. hit the ask the show link to
submit a question. again, openforum.com/yourbusiness. e-mail your questions to firstname.lastname@example.org. brian and phil had helpful advice about how to improve your business. let's get great ideas from small business owners like you. >> doesn't matter if it's your first, second or third, you are going to make mistakes. if you are making mistakes you have to pivot, change strategy or change pricing or focus to be able to react to things you didn't know about or just learned about in the market plait here. >> life is going to give you a lot of noes. it's only to prepare you for that big yes. if you are going to be able to appreciate and do what you need to do when life gives you that big yes. you only get it once. you have one shot. follow your passion in what you would be willing to do for free. never let money be the
motivation. >> do you need a lawyer but you are dreading those hourly legal fees? check out our website of the week. shpoonkle.com. clients write up their legal needs and attorneys bid on the cases. it keeps costs low. many lawyers charge a fee based on the judgment rather than the hourly rate. they check to make sure they are in good standings before they can bid. to learn more about today's show, click on our website, openforum.com/yourbusiness. you'll find more information to help you grow your business. don't forget to become a fan of the show on facebook. we love your feedback. you can follow us on twitter. next time, for decades, american entrepreneurs have been using
chinese factories to outsource production. is that trend changing? the buzz word in the '80s and '90s was outsourcing. i think now, it's about right sourcing. finding which countries are right for your supply chain. >> what's going on in china and why are some manufacturers pulling out and making new factories here in the united states? until then, i'm j.j. ramberg. until then, we make your business, our business. sam: i'm sam chernin. owner of sammy's fish box. i opened the first sammy's back in 1966. my employees are like family. and, i want people that work for me to feel that they're sharing in my success. we purchase as much as we can on the american express open gold card. so we can accumulate as many points as possible. i pass on these points to my employees to go on trips with their families.